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3. If you asked your broker to purchase for you a 7% bond when the market interest rate for such bonds was 8%, would you
3. If you asked your broker to purchase for you a 7% bond when
the market interest rate for such bonds was 8%, would you
expect to pay more or less than the face value for the bond?
Explain.
4. Would a zero coupon bond ever sell for its face amount?
(think about this last one...it involves a little thought!)
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